Question

Suppose that Andy sells basketballs in the perfectly competitive basketball market. His output per day and his costs are as​ follows: Output Per Day Total Cost Variable Cost Average Total Cost Average Variable Cost Marginal Cost 0 ​$10.00 ​$0 ​-- ​-- ​-- 1 15.00 5 ​$15.00 ​$5.00 ​$5.00 2 17.50 7.50 8.75 3.75 2.50 3 22.50 12.50 7.50 4.17 5.00 4 30.00 20.00 7.50 5.00 7.50 5 40.00 30.00 8.00 6.00 10.00 6 52.50 42.50 8.75 7.08 12.50 7 67.50 57.50 9.64 8.21 15.00 8 85.00 75.00 10.63 9.38 17.50 9 105.00 95.00 11.67 10.56 20.00 Suppose the equilibrium price of basketballs is​ $2.50. In the short​ run, how many basketballs will Andy​ produce? nothing ​(enter a whole​ number). How much profit​ (or loss) will he​ make? ​$nothing per day ​(round your answer to the nearest​ penny, and express a loss as a negative​ number).

Answer 1

Answer:

No single unit will be produced.

Profit will be -$10 per day

Explanation:

Find the attachment

Answer 2

In the short run, the number of basketball that should will Andy​ produce should be considered as the $0

And, the profit per day should be -$10

Calculation of the profit:

We know that marginal cost should not be less than the equilibrium price i.e. $2.50. It means that the firm should not generate the single unit also. So here the firm should generate the number of basket ball should be zero.

Also, the total cost is $10 but the revenue is zero

So here the profit per day should be -$10

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